"The Justice Department could sue Apple as early as Wednesday over alleged electronic book price-fixing, while settling with several publishers as early as this week, two people familiar with the matter said." I feel safe already. Update: ...and we have lift-off.

No, but colluding to set prices is an antitrust violation. It's a very fine line.

This case is clearly designed to test Leegin v. PSKS (2007), which struck down the prohibition on vertical price agreements that had stood for almost a century. But Leegin was a 5-4 decision, and Justice Kennedy's majority opinion left a tantalizing opening by stating that "Resale price maintenance … can also be abused by a powerful manufacturer or retailer."

The DOJ has been waiting for a test case, and they've apparently concluded that a better one is not going to show up. How much more powerful can you get than Apple?

It all comes down to Justice Kennedy. Whichever way he decides will be the "5" side of the resulting 5-4 decision.

just raising prices isn't a sin. seriously, what did they do wrong? Like actually wrong?

There would be nothing wrong with this probably except that they are dictating prices for third parties. Lets suppose you are one of the publishers. Its alright for you to set your own price you want to sell at. Its probably even ok for you to talk about it with other companies and all agree on a price you want to sell at. It is absolutely not ok for you to collude with others about what I am allowed to sell the book for. I being Amazon in this case. Amazon has the right to sell for a loss if they desire, which they did. This deal prevents Amazon from operating in a free market.